Byline: Joanna Ramey
As federal regulators edge closer to drawing up some Internet privacy rules, a group of online marketers and retailers has created its own guidelines.
The Electronic Retailing Association — whose 479 members range from QVC and America Online to J.C. Penney Co. and 800.com — aims to make adherence to the guidelines a membership requirement.
Elissa Myers, ERA president, said she hopes the new rules, and others being forged in the Internet industry, will help to convince the Federal Trade Commission not to mandate its own privacy regulations. The FTC is now weighing whether to do just that and has asked Congress for the authority to do so.
Complaints about violations by ERA members would be reviewed by an executive board of the association. Punishment could include a letter of reprimand, expulsion from the organization and referral to the FTC.
The ERA’s privacy rules are largely based on recommendations FTC officials themselves have offered for e-commerce.
For example, the ERA calls on members to notify consumers as to how a site plans to use personal data. Consumers must be given a choice to opt out of having that data used in-house or sold to third parties. In addition, a site must “explain how consumers may obtain access to the information collected about them and maintained or used by the site.”
Steven Hetcher, a Vanderbilt University law professor and Internet-privacy expert, called the ERA privacy rules “fairly standard” for the online sector.
“The privacy-advocacy community would flip it and say you should have opt-in for all personal data,” Hetcher noted.
“The real battle,” Hetcher said, “is whether there is any recourse against companies that don’t comply.”
Besides consumer information, the ERA rules require ads, claims, testimonials and endorsements be truthful and not misleading. If there is any chance a consumer could be misled, ERA members will have to expound on a product and the nature of its claims through prominently displayed disclosure statements.
The ERA guidelines also require:
Comparative ads only “to inform buyers of the benefits of a product and not to run down a competitor’s product.”
Disclosure of any “material connection” between an advertiser and an endorser that would affect the credibility of the endorsement, except compensation.
Provide consumers the means to ask an advertiser not to send them e-mail ads.